Shop

GM hires agency to identify white-collar job cuts

General Motors isn't happy that it's five-percent operating margin is less than the predicted seven-percent at Ford or the 10 percent at Hyundai. To boost its number, Bloomberg reports that GM has hired consulting firm Hackett Group to identify areas in which it can save on white-collar costs, either through job cuts or efficiencies. Unlike in 2009, however, buyouts and tranches of layoffs aren't on the table.

An outside analyst considers Hyundai's returns out of reach, since the Korean firm benefits from exchange rates and more efficient platform sharing. The analyst also considers that GM will only find "a rounding error" in its pursuit of leaner white collar operations, but that might be enough to start. When considering closer GM competitors, through the first nine months of this year, Volkswagen could boast an operating margin of 7.7 percent, Ford's is 6.7 and Toyota is aiming to reach five percent (down from almost nine percent before its recall crisis and the recently steroidal yen). In that case, even a rounding error will make a statement.

Even though we're dealing with a "new" GM, talk of reassigned engineers can easily remind one of the dark days when fat-trimming exercises turned into amputations and handicapped product on the showroom floor. Yet the company is on the up with the continued momentum of anticipated products, and this is what every world class company is required to do. Still, we'll be watching closely.

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.

As a former GM white collar employee, I left last year for a better opportunity with Ford. GM is very top heavy in its management structure especially after the great purge several years ago. It left many areas with one white collar worker with one supervisor with one supervisor, two levels of management watching one engineer work. But a point I've always made, an empty desk never bought a car...

GM has long been known to be top heavy company, and they've had a hard time getting away from that. Hopefully this will be done well and in the long run help GM - I know it sucks that people will likely be losing their jobs.
Glad to hear you found a better home at Ford, I hope things are going well for you!

I just left GM two weeks ago for similar reasons. I reported to 4 different managers. There were only 3 engineers in my group! Totally bassackwards structure. They need to purge the chief and executive levels. They create levels and levels of metrics to for themselves to track to make it seem like they are actually doing something. Cannot get a lot of engineering done when you have multiple managers looking for regular reports on worthless metrics. They also have problems with proliferation. Lots of vehicle variants with

It's good to see that the "dragon is being cut off at the head" and not the tail, as usual. I mean, if you are "in charge" and things go wrong, why lay off workers? Additionally, how many "regular" employee salaries does it take to make up one executive salary (with bonuses)? I don't know, but if an executive's yearly compensation is, say $2 million that is equivalent to 20 $100K employees, even more if the employee's total compensation isn't in the 6 figure range and even more if the total yearly compensation of the exec is more than $2M / yr. Just sayin...

Ugghh. The economy still hasn't hit rock bottom yet? How much worse will it get before it gets ANY better?
My grandmother used to say perilous times are coming (in reference to the prosperity we knew 10 years ago). "What goes up must come down, " she would say. I thought it was just a simple statement that has something to do with physics and dismissed her as being someone out of the loop. I guess I was wrong.

[blocked]

[blocked]

[blocked]

[blocked]

Hmmm... So Alabama has Hyundai, Kia right across the border, Mercedes, and all the military and aircraft engineering... Not to mention great Engineering programs at Auburn, Alabama, and then Georgia Tech is not too far away.... I think Alabama would be a perfect place for GM to move to.

[blocked]

[blocked]

GM is moving its engineering workforce, not to Texas, but to Shanghi. At the same time GM is letting its Michigan engineers go, it is hiring their replacements in China.
http://reviews.cnet.com/8301-13746_7-57345387-48/gm-to-complete-china-advanced-technical-center-in-2012/#ixzz1h8WZ5iz3

Alfonso:
If you lay off a worker in the US and hire a Chinese worker who performs the same roll, that is moving. When the Japanese began adding US engineers, they didn't lay off any Japanese engineers.
I friend of mine used to work at GM Research. She helped train researchers at GM's Chinese and Indian labs, then they layed her off along with most of her lab. All of the research in her area that was done in Warren is now done soley in India and China. Ask her if she thinks her job was outsourced.